Thompson Creek Drops Mount Emmons Option

Thompson Creek Metals has terminated its option agreement with U.S. Energy Corp. to develop the Mount Emmons molybdenum deposit in Gunnison county, Colorado. The option agreement, signed in August 2008, provided for Thompson Creek to earn a 15% interest in the Mount Emmons project by spending $15 million on the project by June 30, 2011.

“We made the strategic decision to step back from the Mount Emmons pro-ject and focus our efforts and resources on our Berg exploration property located in British Columbia,” Thompson Creek Chairman and CEO Kevin Loughery said. “Berg represents an attractive development project that potentially expands our molybdenum production but also can further our diversification efforts. The measured and indicated resources for the Berg property include 3.3 billion lb of copper, 412 million lb of molybdenum and 61 million oz of silver. We have redirected the pre-feasibility funding previously budgeted for Mount Emmons to Berg for an advanced scoping study to be initiated in 2011.

“In addition to Berg, we are continuing our work on the Endako expansion project, which is scheduled for completion later this year, and the construction and development of the Mt. Milligan copper-gold mine, which is expected to commence production in late 2013. Endako and Mt. Milligan are near-term catalysts we expect will significantly increase revenue, net income, and shareholder value. Consequently, we believe it is best to focus our efforts on these three projects and allow U.S. Energy Corp. to develop Mount Emmons as they see fit.”

U.S. Energy CEO Keith Larsen said, “We remain committed to moving the project forward on our own behalf as well as reaching out to other potential partners, including those outside of our borders. We were very pleased to have had the opportunity to work with Thompson Creek on this project. They were a first-class partner, and we appreciate the work they have completed to advance the project over the course of the last two and one half years. We plan to utilize the numerous technical engineering, siting, and cost studies they have completed, which will help us advance the project further toward the development stage.

“Looking forward, we will be reaching out to the Chinese, who have expressed an interest in the project in the past. They tend to have a longer-term view regarding resource inventory. In the meantime we plan to move the project forward, and we have several permitting initiatives under way that we will build upon in the coming months and years,” said Larson.